Marketing: Small is the New Big

Seth Godin is a bestselling author, entrepreneur and agent of change. Godin is author of seven books that have been bestsellers around the world and changed the way people think about marketing, change and work. Find out more about Seth at www.sethgodin.com. For more than 10 years, Seth Godin has been establishing himself in the business world with his irreverent style and unapologetic observations. Not only did Godin coin the term Permission Marketing, the marketing style that requires marketers to ask permission before they send advertisements to prospective customers, he literally wrote the book in 1999. But to Seth, the application of the colloquially tired expression “he wrote the book” didn’t stop there. Godin has spent the last six years wowing the business world by explaining in his column at Fast Company, his blog and his marketing-focused books what savvy business people and marketers sense but cannot articulate: “Out with the old; in with the new.”

BIG used to matter. Big meant economies of scale. (You never hear about “economies of tiny” do you?). 

Years ago, people, usually guys, often ex-marines, wanted to be CEO of a big company. The Fortune 500 is where people went to make a fortune, after all.

Big meant power and profit and growth. Big meant control over supply and control over markets.

There was a good reason for this. Value was added in ways that suited big organizations. Value was added with efficient manufacturing, widespread distribution and very large R&D staffs. Value came from hundreds of operators standing by and from nine-figure TV ad budgets. Value came from a huge sales force.

Of course, it’s not just big organizations that added value. Big planes were better than small ones, because they were faster and more efficient. Big buildings were better than small ones because they facilitated communications and used downtown land quite efficiently. Bigger computers could handle more simultaneous users.

“Get Big Fast” was the motto for start-ups, because big companies can go public and find more access to capital and use that capital to get even bigger.

Big accounting firms were the place to go to get audited if you were a big company, because a big accounting firm could be trusted. Big law firms were the place to find the right lawyer, because big law firms were a one-stop shop.

And then small happened.

Enron (big) got audited by Andersen (big) and failed (big). The World Trade Center was a terrorist target. Network (big) TV advertising is collapsing so fast you can hear it. American Airlines (big) is getting creamed by JetBlue (think small). Boing Boing (four people) has a readership growing 100 times faster than the New Yorker (hundreds of people).

Big computers are silly. They use lots of power and are not nearly as efficient as properly networked Dell PCs (at least that’s what they use at Yahoo! and Google). Big boom boxes are replaced by tiny iPod Shuffles. (Yeah, I know big-screen TVs are the big thing. An exception that proves the rule.) 

I’m writing this on a laptop at a skateboard park that offers free WiFi for parents to surf the Web while they wait around for their kids. They offer free WiFi because the owner wanted to. It took them a few minutes and US$50. No big meetings, corporate policies or feasibility studies. They just did it.

Today, little companies often make more money than big companies. Little churches grow faster than worldwide ones. Little jets are way faster (door to door) than big ones.

Today, Craigslist (eighteen employees) is the fourth most visited site according to some measures. They are partly owned by eBay (more than four thousand employees), which hopes to stay in the same league, traffic-wise. They’re certainly not growing nearly as fast.

• Small means that the founder is involved in a far greater percentage of customer interactions.
• Small means the founder is close to the decisions that matter and can make them quickly.
• Small is the new big because small gives you the flexibility to change your business model when your competition changes theirs.
• Small means you can tell the truth on your blog.
• Small means that you can answer email from your customers.
• Small means that you will outsource the boring, low-impact stuff like manufacturing and shipping and billing and packing to others while you keep all the power because you invent something that’s remarkable and tell your story to people who want to hear it.
• A small law firm or accounting firm or ad agency is succeeding because they’re good, not because they’re big. So smart, small companies are happy to hire them.
• A small restaurant has an owner who greets you by name.
• A small venture fund doesn’t have to fund big, bad ideas in order to put their capital to work. They can make small investments in tiny companies with good ideas.
• A small church has a minister with the time to visit you in the hospital when you’re sick.
• Is it better to be the head of Craigslist or the head of UPS?
• Small is the new big only when the person running the small thinks big. 

Don’t wait. Get small. Think big.

TEN TIPS EVERY GOOD MARKETER SHOULD KNOW

Assuming you’re like me and the rest of the people I know (which means you haven’t figured out everything there is to know about marketing), here’s a list to get you started:

• A product for everyone rarely reaches anyone.

• Cheaper is the last refuge of the person who’s not a very good marketer. It’s a short-term hit, not a long-term advantage. Low price is a great way to sell a commodity. That’s not marketing, though, that’s efficiency.

• Marketing is the way your people answer the phone, the typesetting on your bills and your returns policy.

• If you are marketing from a fairly static annual budget, you’re viewing marketing as an expense. Good marketers realize that it is an investment.

• Advertising is just a symptom, a tactic. Marketing is about far more than that.

• Good marketers tell a story. Effective stories match the worldview of the people you are telling the story to. Living and breathing an authentic story is the best way to survive in a conversation-rich world. Reminding the consumer of a story they know and trust is a powerful shortcut.

• Conversations among the people in your marketplace

• happen whether you like it or not. Good marketing encourages the right sort of conversations.

• People don’t buy what they need. They buy what they want. What people want is the extra, emotional bonus they get when they buy something they love.

• Business-to-business marketing is just marketing to consumers who happen to have a corporation to pay for what they buy.

• Marketing is not an emergency. Marketing begins before the product is created. It’s a planned, thoughtful exercise that started a long time ago and doesn’t end until you’re done.